Before we study about SagarMala project, let’s understand where India stands in terms of ports.
In this globalized world, a country has to unlock the full potential of its entire resource to outperform others. Ports play an important role in the overall economic development of a country. Approximately 95% of India’s merchandise trade is done through sea ports. India is one of the biggest peninsulas in the world with a coastline of ~7,516.6 km. But the contribution to GDP by the water transport service sector is just 0.08%. The ports in India serve as a backbone for EXIM, international trade, coastal shipping, and cruise shipping.
Table of Contents
Introduction
Sagarmala is an ambitious national initiative aimed at bringing about a step change in India’s logistics sector performance, by unlocking the full potential of India’s coastline and waterways. The project was released by the Hon’ble Prime Minister, on 14th April 2016 at the Maritime India Summit 2016.
Let us first figure out how the project got the name SagarMala, it is quite obvious if you look at the shape of the Indian Coastline, it looks like a triangular shape almost like a shape of a “mala” or a garland. around the coastline in the “Sagar” which is the sea.
Background
These are the prominent ports of India. Many of these are evolving into specialized centers of economic activities and services and are vital to sustaining future economic growth of the country such as JNPT, Mundra Port, Sikka Port, Hazira Port, etc.
To assess where things stand before the project was released back in 2016,
- Approximately 95 % of India’s merchandise trade (by volume) passes through seaports.
- Turnaround time (TAT) at major ports was approximately 2.5 days in 2018-19, whereas the global average benchmark is 1-2 days.
- Around 87% of Indian freight uses either road or rail for the transportation of goods.
- location of industries/manufacturing centers from the nearest ports is not economical.
We need to step up to the global standards for operational efficiency. The waterways model contributes about 6% of India’s total modal split which when compared to China is 47%, while in Japan and the US, this share is 34% and 12.4% respectively. Along with this, the proximity of industries to the port will significantly impact transportation and operational cost.
| Mode of Transportation | Transportation Cost (Rs/Ton-Km) |
| Road | 2.0-3.0 |
| Rail | 1.2-1.5 |
| Waterways | 1.1-1.2 |
| Pipelines | 0.1-0.15 |
Vision
Sagarmala will bring about a step change in India’s logistics sector performance.
- Sagarmala aspires to reduce logistics costs for EXIM and domestic cargo leading to overall cost savings of INR 35,000 to 40,000 cr. per annum.
- Direct cost savings, and inventory-handling costs savings resulting from time (and reduced variability) in the transportation of goods
- Sagarmala aspires to reduce carbon emissions from the transportation sector by 12.5 MT/annum.
These are the four pillars of the “port-led development” of the SagarMala Project. Port-led development focuses on logistics-intensive industries (where transportation either represents a high proportion of costs, or timely logistics are a critical success factor).
Also Read
Detailed benefits of Maritime Union of India (MUI) membership
SagarMala Development Company Limited (SDCL)
The Sagarmala Development Company Limited (SDCL) has been incorporated (on 31st August 2016) under the Companies Act, 2013, after obtaining approval from the Union Cabinet on 20th July 2016.
Objectives of SDCL
- Develop & formulate projects emanating from the National Perspective Plan (NPP)
- Assist project SPVs set up by Central Line Ministries / State Governments/State Maritime Boards/Ports etc. for projects in alignment with Sagarmala objectives
- Provide funding window for residual projects that cannot be funded by any other means/mode
- Prepare the Detailed Master Plans for the Coastal Economic Zones (CEZs) identified as part of the National Perspective Plan
- Raise funds from multi-lateral and bilateral agencies as debt/equity (as long-term capital), as per the project requirements
Contact Details
Sagarmala Development Company Limited
124, 1st floor, Thapar House, Janpath Lane, New Delhi – 110001
The project is now named the flagship project of the Ministry of Shipping. It aims to utilize the 7,500km (greater than the radius of the earth) coastline and 14,500km of navigable water ( greater than the entire diameter of the earth) to its full potential. We hope this project completes all the checkpoints in its mission and make India one of the shipping giants of the world.
images credit: sagarmala.gov.in; pngwing.com; mapsofindia.com
